Budget will force local authorities to build up to 9,000 new homes

Budget will force local authorities to build up to 9,000 new homes

It is estimated that 8,907 new builds will take place in 2021 with a further 800 homes being acquired and a further 2,450 being leased.

The Government will announce a plan on Budget Day to force local authorities to directly build up to 9,000 homes next year, it has emerged.

The number of newly built homes under the Rebuilding Ireland plan is starting from a very low base of just 2,000 in 2016. Fianna Fáil’s Housing Minister Darragh O’Brien and Public Expenditure Minister Michael McGrath want to move away from so-called turn-key acquisitions and prioritise councils building their own homes for social and affordable use.

Senior Government sources have said the plan to concentrate on new builds will be “the main focus” of the housing package announced on Budget Day and will amount to “hundreds of millions of euro".

According to figures from Rebuilding Ireland, less than one in five of the 100,000 newly available homes were direct builds by local authorities. Just 17,904 direct builds were finished by the end of 2019 with a reported slowdown in delivery in 2020 because of the Covid-19 pandemic.

“The focus is on regaining momentum in construction and igniting direct builds by local authorities and approved housing bodies," said a government source. 

"Social housing delivery target for 2021 (through build, acquisition, and lease only) is just over 12,000 homes (almost 9,000 of those, builds).” 

Sinn Féin’s housing spokesman Eoin Ó Broin said the Government must follow the advice of the Economic and Social Research Institute (ESRI) to borrow big now, buy turn-key homes while local authority capacity to build their own homes ramps up.

“The truth is that it will take 18 months for any brick to be laid in direct builds; the Government must look to turn-keys as a fast way of delivering not just social but also affordable homes which are needed now,” said Mr Ó Broin.

He hit out at the delay in Mr O’Brien’s delivery of a new housing delivery plan which was due in September but the timeline for which changed to “the autumn”.

Under the plan, it is estimated that 8,907 new builds will take place in 2021 with a further 800 homes being acquired and a further 2,450 being leased. These three groups combined will deliver 12,157 new homes.

A further 10,000 homes are promised under the Housing Assistance Payment (HAP) which is a rent subsidy paid to private landlords.

Of the 100,000 “new homes” promised by the Government, two-thirds are HAP-related cases as opposed to new builds, leases, or acquisitions.

In an interview with this newspaper, Mr McGrath made clear he thinks councils across the country are not building their own homes and are too reliant on the private sector to help address the country’s housing crisis.

“There are a lot of acquisitions and turn-key homes that are being secured by councils around the country," said Mr McGrath. "The focus of Government is to try and get councils and approved housing bodies building again, in a much more significant way.

“I believe there's better value in councils building homes directly, and that's the direction that I think we need to underline in the budget. We're very keen as a Government to shift the emphasis to direct builds in terms of the delivery of public housing. That was always a core value of my party.” 

 

 

 

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